Monday, 14 January 2013

There were few economic reports from the United States last week. The trade report did show a 1.0 percent rise in exports in November and a 3.8 percent jump in imports, suggesting a growing economy.

In the euro area, a report from the European Commission showed that its economic sentiment indicator rose to 87.0 in December from 85.7 in November. This was its second consecutive month of improvement.

In China, exports jumped 14.1 percent in December from the previous year, well up from 2.9 percent in November, while imports grew 6.0 percent in December after having been flat the previous month. However, new local currency loans by banks fell to 454.3 billion yuan in December from 522.9 billion yuan in November.

Economic data from Japan were also mixed. The economy watchers survey showed that the diffusion index for current conditions jumped to 45.8 from 40.0 in November while the future conditions index surged to 51.0 from 41.9. However, the index of leading economic indicators fell 0.9 point in November while the index of coincident economic indicators fell 0.6 point in November, its eighth consecutive decline.

On the whole, though, global economic conditions look relatively benign, at least on the surface. Which is possibly why investors are getting back into equities. In the immediate aftermath of the US Congress producing an agreement to avert the so-called fiscal cliff, the MSCI All-Country World Index jumped 3.1 percent in the first week of 2013.